Nov. 19, 2010
CHARGE OF CONSPIRING TO IMPEDE IRS FROM COLLECTING $349,000 IN TAX LIABILITIES LEADS TO CONVICTION
(HOUSTON) - Jimmy Mitlo has pleaded guilty to one count of willfully conspiring to impede and to impair the IRS in its collection of more than $349,000 in income tax liabilities he owes from 1989, 1990 and 1991, United States Attorney José Angel Moreno and Internal Revenue Service - Criminal Investigations Special Agent in Charge Rodney E. Clarke announced today.
Mitlo pleaded guilty today before United States District Judge Melinda Harmon pursuant to a plea agreement to the single count alleged in a criminal information filed in this case on Oct. 29, 2010. According to the plea agreement filed in the case, Mitlo signed a decision document in the U.S. Tax Court in 2000 agreeing to the amount of income tax liabilities and penalties he owed for his 1989, 1990 and 1991 U.S. Individual Income Tax Years. The total amount of taxes, penalties and accruing interest still owed for those years amounts to approximately $349,939.09.
Mitlo admitted in the plea agreement that even though he made substantial amounts of money in years 2004 through 2008 in repairing machines and in selling scrap metal, he conspired with others to conceal his income and assets from the IRS instead of paying his old income tax liabilities. Some of the steps Mitlo and others undertook to conceal income and assets from the IRS as listed in the plea agreement included cashing checks at check-cashing companies, using bank accounts opened in the names of others, failing to file timely income tax returns for years 2001 through 2008, depositing large amounts of cash into the nominee bank accounts, and sometimes breaking larger deposits of cash into amounts of less than $10,000, the amount which requires a bank to report cash transactions to the U.S. Department of Treasury.
In the plea agreement, Mitlo agreed to pay restitution to the IRS in the amount of approximately $349,939.09. The plea agreement allows the parties to argue at sentencing whether the restitution order and the amount of tax loss for sentencing purposes should be increased to include any alleged income tax liabilities owed by Mitlo for 2004, 2005, 2006, 2007 and 2008.
Judge Harmon set sentencing for March 25, 2011. Mitlo faces a maximum of five years incarceration for willfully conspiring to impede and impair the IRS and a maximum fine of $250,000. Mitlo has been permitted to remain on bond pending that hearing.
This matter was investigated by IRS Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Charles J. Escher and by Jonathan R. Marx of the Tax Division, U.S. Department of Justice.